The Biden administration is crowing about the record number of sign-ups for Obamacare this year. They shouldn’t be.
A record 16.3 million people signed up in the latest enrollment period. Supporters trumpet the notion this is double the number who signed up when Obamacare first became available. Sounds great, right? Not so fast. When they were selling us the Obamacare legislation, they promised 21 million people would sign up right away. That’s never happened, and they’re still 30 percent short of the goal they set for themselves ten years ago.
Besides, it’s no mystery why enrollment went up this year. Obamacare subsidies have been jumbo-sized and the jumbo subsidies have been extended through 2025. Now, some people don’t have to pay for it at all. They get zero-dollar premiums. If you give it away for free, of course more people will sign up. No mystery there. So now they’re practically giving it away and they’re still 30 percent short of where they thought they would be a decade ago. That’s not a triumph. It’s an utter abysmal failure. The failure is not unexpected; only half of Americans approve of Obamacare and, now as we’ve seen, most people don’t want it, unless it’s handed to them on a silver platter.
It’s not hard to see why people don’t want it. First of all, lots of the best hospitals and doctors won’t take Obamacare. Obamacare patients don’t have access to top-tier care. Doctors hate Obamacare because it adds layers of paperwork to their burdens.
Second, Obamacare has led to concentration in the individual insurance market. Prior to Obamacare, there were lots of insurers competing on price and features. Obamacare standardized many of those features and, in addition, caused lots of insurers to drop out. I read one article crowing about how most of the country now has three insurers in their state Obamacare exchange. Only three? Here’s what happens when the market becomes concentrated and you only have three companies competing for business, according to a recent GAO report:
From 2015 through 2020, most states’ exchanges were concentrated and became more concentrated over time…. In 2020, the exchanges were concentrated in all states…. [M]arket concentration … can result in higher premiums due to less competition in the market.”
So what’s being covered up by the jumbo subsidies is the fact that premiums are rising behind the scenes, because of Obamacare. Insurers can hike prices because federal subsidies ensure consumers don’t feel the pain. By the way, the overall price tag for those subsidies is a lot higher than originally estimated.
Obamacare is also causing overall healthcare costs to go up. The insurance taxes in Obamacare get passed along to consumers. Obamacare was supposed to keep people out of expensive emergency rooms, but ERs are more crowded than ever.
But the most insidious effect of Obamacare is increasing dependency on government. People are being trained to rely on government as the answer for everything instead of relying on themselves and looking to the private sphere for solutions to what they need. The law putting jumbo Obamacare subsidies in place also pushed welfare spending further into the middle class. A family of four that makes $111,000 a year is now eligible for subsidized health insurance. That’s crazy. Most people who take the subsidies already had health insurance, so government dependency is crowding out private insurance.
There’s been commentary recently that we’re turning into a nation of welfare moochers. People can make $80,000 to $100,000 a year in Obamacare subsidies and other government benefits for sitting around doing nothing. That’s not normal, healthy, or sustainable. As the economists like to say, things will continue until they can’t.
©Christopher Wright. All rights reserved.
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